Correlation Between MRM SA and Immobiliere Dassault

Can any of the company-specific risk be diversified away by investing in both MRM SA and Immobiliere Dassault at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining MRM SA and Immobiliere Dassault into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MRM SA and Immobiliere Dassault SA, you can compare the effects of market volatilities on MRM SA and Immobiliere Dassault and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in MRM SA with a short position of Immobiliere Dassault. Check out your portfolio center. Please also check ongoing floating volatility patterns of MRM SA and Immobiliere Dassault.

Diversification Opportunities for MRM SA and Immobiliere Dassault

-0.14

Correlation Coefficient

MRM SA  Immobiliere Dassault

Good diversification

The 3 months correlation between MRM and Immobiliere is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding MRM SA and Immobiliere Dassault SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immobiliere Dassault and MRM SA is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on MRM SA are associated (or correlated) with Immobiliere Dassault. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immobiliere Dassault has no effect on the direction of MRM SA i.e., MRM SA and Immobiliere Dassault go up and down completely randomly.

Pair Corralation between MRM SA and Immobiliere Dassault

If you would invest  5,000  in Immobiliere Dassault SA on October 7, 2024 and sell it today you would earn a total of  160.00  from holding Immobiliere Dassault SA or generate 3.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	63.16%
Values	Daily Returns

MRM SA  vs.  Immobiliere Dassault SA

MRM SA

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days MRM SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong primary indicators, MRM SA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Immobiliere Dassault

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Immobiliere Dassault SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Immobiliere Dassault is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with MRM SA and Immobiliere Dassault

The main advantage of trading using opposite MRM SA and Immobiliere Dassault positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MRM SA position performs unexpectedly, Immobiliere Dassault can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Immobiliere Dassault will offset losses from the drop in Immobiliere Dassault's long position.

The idea behind MRM SA and Immobiliere Dassault SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.